Leveraging Association Health Plans for Small Employers (feat. Grace Brangwynne)
TRANSCRIPT
Click here to listen to the episode, published March 3, 2026.
John: Thank you all for joining us today for another episode of our podcast, Moving to Value Unscripted. My name is Dr. John Rodas, and I'm a recovering ex-hospital president and am proud to be the president of the Moving to Value Alliance. The Moving to Value Alliance (MTVA), a 501c3 nonprofit, is a multi-stakeholder grassroots organization whose purpose is to foster a community that aims to create a value-based healthcare ecosystem with high-quality outcomes at a reasonable cost for plan sponsors and their members, beneficiaries, or employees. I want to thank our members who support makes this podcast possible. We'd like to give special recognition today to our trade member, CapitalRx. I'm joined by my fellow board members, Dr. Steve Schutzer, Lisa Trumble and Kim Lynch.
Steve: Hi, I'm Dr. Steve Schutzer, orthopedic surgeon, co-founder of the Moving to Value Alliance. I'm also co-founder and chief medical officer of Upswing Health, a national virtual orthopedic company focused on improving access, clinical outcomes and value in musculoskeletal care.
Lisa: Hi, I'm Lisa Trumbull, the president and CEO of Southern New England healthcare organization based here in Windsor, Connecticut. We're a physician-led clinically integrated network focused on population health and value-based care in both Connecticut and Massachusetts.
Kim: I'm Kim Lynch, founder and CEO of Metis Health Technologies, where we help clinicians and healthcare organizations streamline operations, increase revenue, and deliver better patient care. I'm originally from Michigan, now based in D.C.
John: Our guest today is Grace Brangwynne, Policy Director for Healthcare, Insurance and Housing at the Connecticut Business and Industry Association, or CBIA. In its 2026 Policy Solutions, the CBIA listed the authorization of Association Health Plans, or AHPs, as a top-tier priority to combat sharply rising health care costs. The CBIA already operates CBIA Health Connections, a private insurance exchange to help small businesses. They argue that allowing small businesses to pool together through AHPs would give them more leverage to negotiate rates directly with carriers and lower costs for their employees. Critics fear that Association Health Plans will attract younger, healthier groups, leaving the state's official ACA exchange with a sicker pool of participants who could face even more sharply rising costs. Grace joins us today to discuss the CBIA's latest push for Association Health Plans in the Connecticut legislature. Grace previously worked as a government affairs coordinator for Connecticut Realtors. She managed Congressman Joe Courtney's 2024 re-election campaign and served as regional project coordinator on the 2022 re-election campaign for Governor Ned Lamont. She holds a Master's of Public Administration from the University of Connecticut School of Public Policy. We talk a lot on this show about how health care is delivered, but Grace is a leading voice for the people who pay for it, and she has a unique vantage point on how legislation in Hartford directly impacts the survival of mom and pop shops across the state. Grace, welcome to Moving to Value Unscripted.
Grace: Thank you so much, John. And thank you so much to the Moving to Value Alliance for having me on the podcast this morning. I'm so excited to talk about one of my favorite topics, which is Association Health Plans. And I'd really like to kick off the conversation by sharing kind of an anecdote on how I really got involved in this issue.
John: Go for it.
Grace: So prior to working for CBIA, I worked for a CBIA member company where I was a real estate lobbyist. And for the first two years of my government relations career, I participated in the Association Health Plan Coalition led by my predecessor at CBIA, Wyatt Bosworth. And the first year after I completed my first session at the capitol, I sat down with Wyatt and I asked him for his advice on coalition building. And I remember saying to him, one day I might be in your shoes. Two years later, I am now sitting in his exact office, lobbying on the same exact issue as he did two years ago. So for me, this is not only a full circle moment in my career, but also I have a very unique perspective on how Association Health Plans look from the outside. And that can give me more leverage on how to better communicate it to policymakers and help our small businesses communicate the impact of this proposal. So I'm very happy to be here, anticipating a very robust discussion today.
John: So Grace, you know, it's an interesting segue from, you know, real estate into healthcare. And, you know, I'll be guilty as charged, even though I'm a former hospital president, I don't know a lot about Association Health Plans. But I do know that employers across the state, of which there are many, both small, medium and large, particularly in manufacturing, a lot of people don't even recognize, struggle with healthcare costs for their employees, and over the years have shifted a lot of the costs to their employees through high premiums, deductibles, co-pays, et cetera. Tell me a little more about your own journey, kind of that transition, how that was for you to get into the healthcare space. And tell us a little more about just what the Associated Health Plans accomplished.
Grace: Sure. So like many lobbyists in the space, we often toggle between campaign work and lobbying. So that's where I came from in terms of my career transition. So I did a campaign right out of college, did a little bit of lobbying on the real estate side. And that's really where I got to know the folks at CBIA. So I was very involved. And I remember my supervisors at Connecticut Realtors really encouraging me to listen and also to learn. So after I worked at Connecticut Realtors, I led a congressional campaign, and then I applied to work at CBIA. And it's funny, because I often joke to my current boss, Chris, that the majority of my interview was just me word vomiting about Association Health Plans, because I did have that exposure. And to my earlier point about having an outside perspective on Association Health Plans, on its surface, the impact is very clear. You know, we want to increase access to healthcare for small businesses, just because there is a shrinking small group market. But underneath that, there's a lot of technical aspects in terms of solvency and regulation. So my approach this year is taking a high level, grassroots strategy and really encouraging small businesses to tell their story to their legislators. You know, every time I talk to the chair of the insurance committee, I always say, what can we do to get this over the finish line? And she says to me the same exact thing every single time, every text, every phone call. She says to me, we need small and medium-sized businesses to testify. So my role in this equation this year is to be kind of a subject matter expert, but to kind of take a backseat and let our small businesses really tell their first person perspective about the cost impact and how this would really change their financial outlook and also increase access to high quality, affordable health care. I guess if I were to kind of summarize what Association Health Plans do, it allows small businesses to pool their risk and receive health insurance as one large employer instead of many small businesses. That's it, point blank, period. And that's really the message that I wanna drive home to our members.
Lisa: And Grace, even though we're sitting here in Connecticut, this is not a new concept, right? There are a number of states that have done this. They've been successful at it. The federal government recognizes the ability to do that. But what has occurred in Connecticut and other states is that at the state level, they've resisted allowing Association Health Plans or MEWA's, Multi-Employer Welfare Associations. What do you think the temperature is in Connecticut right now with the legislature. What's their opinion and likelihood of considering this for the coming years as an option? And what are you hearing from small businesses and mid-sized businesses that are struggling with healthcare costs these days?
Grace: You know, I'll start by giving a little bit of context on where this proposal has gone in the past. So in 2023, Association Health Plans was voted favorably out of both the Insurance Committee and the Appropriations Committee, but was ultimately not taken up by the House. So it kind of died after the committee level. And I do want to emphasize that there was wide bipartisan support for this proposal in both 2023 and 2024. So we're really looking to at least get it out of the House. I do anticipate kind of a challenge in the Senate, since many folks from the Democratic caucus are in favor of a public option. But I think if we really drive home the mission and address some of the main concerns with Association Health Plan, I think the message will be a little bit clearer. I know Virginia has had a very successful model for a MEWA, and I've had many conversations with folks with their chamber about best practices and what would happen if Association Health Plans were actually going to be passed. But I think right now, the need is just to communicate, drive home the message. And I will say too, kind of acknowledging the opposition standpoint, there are two main points of contention associated with MEWA's. The first is discrimination in regards to pre-existing conditions. And the second is in regards to financial solvency. And I will say the version of Association Health Plans that CBIA has put forth since 2023 is strictly prohibits any discrimination against those with pre-existing conditions, but it also requires sponsoring associations to have $4 million in capital reserves in order for that plan to be financially solvent. So we have made strides to address those points of contention, and I think we just need to communicate that more.
Steve: And Grace, you know, talk about that financial risk. Do most of the AHPs have a stop loss behind them to cover their potential losses?
Grace: Yes. So our version of Association Health Plans, again, modeled after the Virginia bill, also requires stop-loss plans at the aggregate level and for individual benefit plans.
Steve: How many of the states, Grace, currently have AHPs?
Grace: There's a handful. I'm not too sure of the exact number. I know some of the states that we've been working with are Maine, Virginia, New Jersey are kind of the big three that have had MEWAs for a while. Washington State has a MEWA in addition to a public option, which I think is very, very interesting. So what we're seeing across the nation is that Association Health Plans are kind of tailored to whatever environment is appropriate to their corresponding state. So I think there could be a lot of room for modifications should this proposal be passed to really fit Connecticut's healthcare environment.
Steve: Grace, you used the term MEWA just for our listeners. Can you tell us what that stands for?
Grace: Yes, it's Multiple Employer Welfare Arrangement. So there's a lot of acronyms in this space. So I'm glad you asked that question, Steve.
John: Yeah, I was going to ask a similar question. And I was going to ask, what are the nuanced differences between MEWAs and AHPs?
Grace: Yeah, so Association Health Plans is kind of the colloquial term for this type of proposal. But a MEWA, it's more of the financially regulatory body that oversees the Association Health Plan, if that makes sense. So once you kind of get into the weeds of the legislation, what this bill does is it allows sponsoring associations to establish a trust for this MEWA. And there would be five elected board members who oversee the governance and oversee basically the bank accounts for these plans.
John: So in the AHP, the employer has a responsibility to manage the plan. Is that fair?
Grace: Correct. And so for a self-funded MEWA, the sponsoring associations have what's called a fiduciary duty to act in the best interest of their beneficiaries. So what that means is that they want to provide the best value healthcare at the lowest possible cost in order for their beneficiaries to have that cost savings.
John: Music to our ears.
Grace: Right, right.
Lisa: Yeah. And Grace, just to maybe help explain why this is necessary, it might be good to get your perspective because you're out there talking to the business community where many of us have been on the provider side of this equation, to understand why this principle is so, or Association Health Plans, is so important. You know, as a CEO of a company that's relatively small, I know our options for insuring our employees. And we're talking like organizations with a hundred or less or 500 or less. There's very few commercial plans out there that are quoting that business. And more often, if you're looking for a fully insured product, it comes with a big wraparound and inability to make decisions around how to innovate and change or improve the care of your, or the health outcomes for your employees, you're kind of restricted to what you can do. And it's, you know, employers are facing 20, 30 percent premium rate increases because of it. I'm wondering what you're hearing, how you intend to take what you're hearing to help advance Association Health Plans, but more importantly, to help the audience understand why it's needed in the state and elsewhere.
Grace: Sure. I think we're really living in times of volatility, especially in regards to programs like Medicaid, as well as the exchange. So in my role as a CBIA lobbyist, we do a lot of member engagement. So working with local chambers and going to events where we can really hear directly from our members about the costs that are affecting them. And for the most part, all the feedback that I've gotten in terms of healthcare has to do with increased premiums on the exchange, especially in regards to expiration of the enhanced premium tax credits that were implemented during COVID. You know, I've heard from many chamber staff saying that their premiums have gone up hundreds of dollars, and that's just not going to be sustainable in the long run. So I think what we're seeing at the state level is really a concerted effort by the state government in order to alleviate some of those premiums. I know in the past few months, Governor Lamont has authorized $70 million to subsidize premiums on the state exchange through Access Health Connecticut, but that $70 million is only sustainable for one year, and there are income restrictions on who can receive those state-level premiums as opposed to the federal premiums. So really, we're thinking that now is the time to strike when the iron is hot. People need healthcare. That's what Association Health Plans are really trying to solve. Again, like I said, it's really revolving around the rising premiums on the exchange. So hopefully that's going to be the end goal.
Steve: Grace, as you suggested earlier, one of the concerns about AHPs is that they tend to, maybe the word is cherry pick, healthier population. But I don’t — is there any substance to that? I don't understand. I mean, these are just small employers that have 40, 50 — how is that different than Pratt & Whitney? I mean, it's just a body of people. Is there any substance to that concern about cherry picking?
Grace: Yeah. So back in 2023, there was a press conference by folks from the Commission on Racial Equity and Public Health. And they made the very, I think, salient argument that particularly folks who are in the minority or from minority communities are faced with higher premiums due to them having chronic conditions. And I think that's one of the narratives that we are trying to address. In our version of the bill, you know, we have something called composite rating, where every person in that employer group is going to receive the same rate regardless of their background. So that's one of the things that we are trying to kind of communicate. And I'll be quite honest, you know, it's a very salient point, especially when you look at national versions of the Association Health Plans who don't have these built in language in order to protect those who have pre-existing conditions.
Kiim: So Grace, the CBIA argues that the state mandated benefits add over $2,000 to annual premiums without necessarily improving outcomes for small employers. And we've talked a little bit already about bringing value. And that's really the angle that at MTVA, we're coming at this equation of how to increase value in the system. So I'm curious for your take on some of those mandates like mental health parity or maternity coverage that could prevent really expensive downstream costs. I'm curious how you think about that tension and what's the framework for a small business to distinguish between, you know, mandate creep that's genuinely wasteful versus coverage that actually protects their employees, families, and their bottom line.
Grace: Sure. I mean, for us at CBIA, we definitely look at health benefit mandates in terms of longevity. So I think in order to consider whether a mandate is going to be effective or not, we need to look at the numbers and see who's actually using these services. I mean, I'm not going to dispute that a lot of these benefit mandates are medically necessary. You know, they do help people who need it. But you know, I think in the long term, we would also be interested in looking at potentially sunsetting some of these mandates, depending on who is using them in order to kind of make room for ones that are maybe more effective or have kind of a broader access. So I know this session, there was a benefit mandate about providing coverage for scalp cooling for patients who are undergoing chemotherapy. And you know, for us, obviously, that's a very medically necessary service. But we'd also be interested, like I said, kind of taking a look at all of the 81 plus mandates and seeing which ones can be kind of phased out or if the scope can be reduced if necessary.
Steve: Yeah. The word cherry picking is a sensitive one for me, probably for John too, because as you know, the ACA precluded hospital physicians from owning hospitals. You know, private equity can own a hospital, insurance companies can own a hospital, Catholic institutions, but physicians can't own a hospital because we would cherry pick despite the fact that there's no data to support that. So I suggest that cherry picking just doesn't wash with me. And you know, I don't think — Grace, interested in your opinion — somewhat segmenting the population may not be a bad idea. I mean, right now we pool risk amongst tens of thousands of people, but what if we focused on those at 5% of the population that cost 80% of the spend and actually focused on that segment and dealt with that appropriately? Is that such a bad strategic position?
Grace: Well, it's interesting you say that because when we look at the Virginia model of Association Health Plans, they have a standing agreement with each of the local chambers of commerce to allow industries to come together, not necessarily as under the whole group of the Virginia Chamber of Commerce, but come together as industries to go through that administrative process to obtain a plan. So, for example, my counterpart in Virginia was talking about child care providers coming together to pull their own risk within that industry. So it's interesting that that could be a model in the future, for sure.
John: That's interesting. And it makes a lot of sense, actually, because some employers, I guess, would have similar kind of populations of their employees with similar kind of health needs, right? Whatever — an employer that has predominantly women, for example, as employees are going to be much more focused on maternity care, child care, fertility services, things like that. Whereas a group with younger male population might have totally different needs, right? So it makes sense for them to group. So it's not cherry picking per se, but it's aggregating based on the risk of their own populations. So you're not muddling it.
Grace: Yeah.
John: Basically, it's freedom to employers, right, to do that.
Lisa: Yeah, I think, you know, when you look at the way insurance is sold today, right, by and large, employers are sold products to insure their employees and the risk associated with the health of the employees, right? And then 90 percent of it, I'm not saying that there hasn't been really good efforts to put in place methods and ways of managing the care, right? Initially, care wasn't managed, right? It was what it was. And it wasn't any coordination, it wasn't any integration, it wasn't a measurement of quality. A lot of that has been put into place. And when you think of the principles of insurance and aggregation of a broad base of individuals across multiple employers, the whole point of having the insurance is that the insurance balances the risk to any one employer because you're pooling and aggregating across many. And that's what the Association Health Plan is intending to do, but on a smaller scale. It doesn't mean that the Association Health Plan itself can't look at populations and say, what would we want to put in place to manage our oncology patients that would help improve the outcomes, both from a cost and a quality perspective for those that are receiving cancer care across all of these employers, right? It's just that to date, that really hasn't been done. It's been left to the provider side of the equation to make most of those changes. But what's happening with the Consolidated Appropriations Act is employers are getting more and more involved in understanding the types of decisions that they can make within their health plan to improve the outcomes. And I think Association Health Plans will allow that to occur for many smaller employers aggregated under one umbrella in a way that they can't do today because they're relying on the traditional health insurance industry to do that. And I wonder, Grace, if you have had any discussions like this, or it's maybe too early just because we're just looking just to get Association Health Plans off the ground, right? Because the counterbalance to the, we don't want to discriminate, cherry pick, or allow employers to make different decisions around who receives what care, is this idea of figuring out how best to manage care within the context of the plan itself.
Grace: Yeah, absolutely. And like I said before, I mean, there is an opportunity to segment by industry, but you're segmenting by group. You're not segmenting at the individual level. So I think, you know, in practice, if Association Health Plans were to be passed, how it would look for, you know, a local chamber of commerce is that they would say, hey, here's the open enrollment period. Please let us know if you want to be part of this plan. And also Association Health Plans are really voluntary. So you could have a group of, you know, law firms saying that, hey, we all want to be part of this. We could have a group of child care providers saying that we want to be part of this one plan. So there is that opportunity to pull risk at the industry level as well. So that's kind of the outcome that we're hoping for. That would be the ideal scenario, the pot of gold at the end of the rainbow, for sure. And I will say we feel that the sponsoring association needs to have enough administrative support in order to really administer these programs. So the way that the Virginia Chamber does it right now is that a group of people in a certain industry would come and say, I want to be part of this plan. The Virginia Chamber would then say, okay, we want to make sure that you qualify. you know, you have at least two employees, things like that. They would then connect them with a sales rep from their carrier who does more of the back-end insurance administration process. And I will say the sponsoring association typically contracts with a third-party administrator who does the really technical part of the claims work. But the sponsoring association is kind of the gateway to accessing these health plans.
Steve: Yeah. Grace, you just covered a couple of things I want to ask about. Maybe we should have started with this, but just the structure of the AHP, because I'm not that familiar with it. It sounds a little like a captive. The AHP is self-funded, I assume, or?
Grace: Correct.
Steve: It is self-funded.
Grace: Yes.
Steve: And who sells into — are there brokers? Are they independent brokers? Are they in the BUCA rails? Who educates the employers about these plans?
Grace: Yeah, absolutely. So the sales reps from the carriers would then work with the local brokers in order to communicate these plans. So if a business has a broker that they would use, they would also be looped into that conversation. And I think that's part of what makes the Association Health Plan bill so technical is that there's so many different parties who are participating. And that's kind of where we got caught in the last few years, trying to explain, you know, the branches that are in the trees, right. But now we need to see the forest. So that's kind of where we're zooming out and not necessarily emphasizing the technicalities of it to small businesses, because I can speak from experience, lobbying on healthcare, going from real estate to insurance — huge learning curve. Huge learning curve.
Steve: I can imagine.
Grace: And I have the ability to take a step back and think, what do these small businesses really need to know? And that nuance part is where I'm going to come and step in and talk to policymakers about the fine details. So there's a lot of different parties involved. There's, again, the businesses, the sponsoring association. There's the trust that oversees the execution and the financial governance of these plans. There's the carriers. There's the brokers. So really under the surface, there's a huge iceberg that people kind of get tripped up on.
Kim: Well, and to that iceberg, right, and to the complication of healthcare and purchasing, right now, most small employers have no idea whether they're getting a good deal or not.
Grace: Exactly.
Kim: They just know premiums have gone up, right? And this idea, I love what we're talking about of, you know, imagine a world where businesses in Connecticut, whether they're in an AHP or not, could benchmark against one another using simple metrics. I like to lean into, and where my mind goes, is per capita costs and per capita outcomes. We used to spend 10K per employee. Now we're at 8,500 with better retention and healthier people on the job. I think that kind of transparency could help businesses, as we're describing, learn from one another. What did you do? How did you renegotiate? What happened here that your ED costs went down? Whether that's a specific carrier arrangement or direct primary care partnership, something else entirely. Is the CBIA thinking about creating that kind of peer learning infrastructure?
Grace: Yeah, I think for us, transparency is the best quality. I know going back to the whole conversation about health benefit mandates, one of the things that we lobbied for is attaching a fiscal note to each potential health benefit mandate, just so consumers know what the cost would be. So in terms of thinking about that on the macro scale, we honestly haven't gotten that far yet. I mean, the bills might have been passed, but it's something that we would definitely consider in the future. I think we need to quantify any healthcare proposals that come our way in order for consumers to make the best, most informed healthcare decision as well. And if I can also say something about the needs that Association Health Plans fill, we want to bridge the coverage gap in the small group market, but we also have a lot of sole proprietors and 1099 contractors who are still looking for that solution as well. The Washington model of Association Health Plans actually allows people who have 1099 status and sole proprietors, so with one employee, to join that association. And I'd be interested in learning more about that model because for the most part, anyone who's eligible for an Association Health Plan, we need to have W-2 status. So there is that micro level in the market that we still kind of need to fill. And the governor has a couple of proposals in regards to that. So different solutions for different needs.
Lisa: As I was listening to the last couple of questions and your answers, I couldn't help but think — when you're an employer, if you're looking at Association Health Plans — and the word association implies something, you have to be in a related type of business, right? So let's just say, let's take restaurants as an example. I don't even know if it's a great example, but you know, if there's an Association Health Plan for restaurants, we all know that employees move between restaurant A and restaurant B and restaurant C and D. And what happens when you're providing a health insurance benefit that isn't seen in like a Medicare beneficiary situation is you don't have that like longevity of understanding what's happened with the healthcare of that person, right? You have snapshots of what happened at restaurant A or B or C. An investment in that person's health could have been made at restaurant A, but it's not benefiting until restaurant C, right? So you get all these like spikes unnecessarily in the experience at a small level because of retention issues around employees and the way that the employer may or may not choose to make investments in their own individual health plan because they won't see the long-term benefit. You put the Association Health Plan in place, and now you have the ability as an association to see the benefit of making those investments over time and balancing the risk at a broader level. So it's not impacting restaurant A, B, C differently, but it might push those individual employers to think about the mandates differently because then they recognize that investing in, I don't know, diabetes care or whatever it might be, even though it may not benefit them, the pooling of the risk over time would help them decrease the cost, right? So I wonder if that's a real counterbalance to the advocacy position around the mandates and the value of the mandates, whether or not they exist in Association Health Plans, because the ability to make those decisions and moderate the experience, the claims experience and up and down and the individual impact at a local business level, I think it could be really compelling because it benefits the entire plan overall. And I just wonder if you've thought at all about that or have heard any discussions like that.
Grace: Sure, I think part of the beauty about Association Health Plans is that employers can really design their own plans. So for example, with a self insured MEWA, you can opt to have benefits, you know, if there's an industry or a group that would really benefit from one of the mandates, you can add that onto the plan, you have that as an option. But you know, the base plan is that there's going to be no benefits, benefit mandates, I should say attached to a self insured MEWA as well. And I know, you know, you use the example of the restaurant association, I think we also have to consider different healthcare options for different classifications of workers. So like I said before, Association Health Plans would benefit those who have W-2 status. With the example of the restaurant association, you also have folks who work part-time. You also have folks who work as contractors and are part of that gig economy. So I think we really need to think about different solutions in addition to Association Health Plans for individuals with different employer statuses. So there's a lot to be thinking about for sure.
Kim: Well, and building on that, Grace, I'd love to give you the chance to say, who is doing this well? I mean, you've mentioned other states. I'm curious within Connecticut or within specific types of employers where you're seeing this kind of innovation happen in a good way. Lisa, I love your point of turning the, you know, the 12 month, like they're not going to be my employees into an association level, like actually we're stronger together, whether it's banking where they tend to have high turnover or restaurants where they have high turnover. So Grace, where are you seeing at the employer level or kind of at that association level that the innovation is happening? Who's doing this well?
Grace: That's a great question. And, you know, I'll be honest, I'm kind of drawing a blank at this point because all the feedback that I've heard is just about the need, right?
Kim: Okay.
Grace: We have heard some proposals that could really address some of those concerns. So, for example, this session, the governor came out with a bill that talked about some of the solutions for these independent contractors and for part-time workers. So one of his main health care proposals, because there's a few, also includes a tax credit for businesses who create an Individual Coverage Health Reimbursement [Arrangement], commonly known as an ICHRA. And in that same bill, he also introduces the idea of a portable benefit account specifically for those independent contractors and for those workers in the gig economy. So, again, I think we need to consider all solutions for employers of different classifications and who may have some of the more mobile jobs going from place to place to place.
Kim: I'm really glad you made that connection with ICHRA because we have talked about ICHRA before, and that's a perfect bridge of the kind of innovation that can match the employees or the type of industry and that these solutions link up together.
Grace: To that point, too, you know, Access Health Connecticut has established an ICHRA program, and that could really be another option for employers, you know, in the midst of trying to figure out what to do, you know, at the macro level as well. It really does give employers the opportunity to put money into an account that can be used for qualified medical expenses. I think there may be some difficulty with shifting the onus on managing healthcare costs of the employee. And there's also the idea that now employers can't really take a look at healthcare costs at the macro level because these plans are so individualized. But at the same time, it is an option and it fills a need at this time.
Steve: It's funny, I was going to ask that question. We had Chris Ellis on, founder and CEO of Thatch, one of the ICHRA startup companies, and really very impressive plan. I was going to ask that — if it needed a workaround for small employers, because there's no limit to the small size of a company to get on an ICHRA plan. But is your thinking, Grace, here in Connecticut, that there would be one AHP? I mean, is there a critical mass of employees where they have purchasing power, or would there be many AHPs? Yeah, so that kind of ties back to the idea of capital reserves. So in Virginia, the capital reserve for a sponsoring association would be $4 million. And that's based on the amount of insurable lives in Virginia. In Connecticut, we're really reconsidering changing those capital reserves to be proportional to the amount of insured lives in Connecticut, but also give more associations the ability to provide that plan for their employees. So maybe in an ideal world, we could have an Association Health Plan bill where the capital reserve is only $2 million. That would give more trade associations the ability to create their own plan and thus create more competition in the market. So we're really hoping to help out different industries and different associations who have those means to create this kind of risk pooling.
John: That makes sense. You know, going back to Kim's earlier point, Grace, the solution here is going to lie in the data. It's all about the transparency. As you know, there's a tremendous amount of, or maybe you don't know, but there's a tremendous amount of obfuscation in healthcare about the cost of anything. Nobody knows the cost of the medicine they take. You know, they think it's a $5 copay, where in reality the drug costs $300 that their employer is paying or someone's paying. The hospital's variability in cost across the ecosystem, most people think, I think the average consumer and probably the average employer think, that's all the same. You have your hip replacement here, hip replacement there, it's going to be the same. The truth is, any one of us could speak to CBIA and highlight the tremendous variability in both cost and quality across the healthcare ecosystem. Even within the same health system, by the way, hospital A versus hospital B could be tremendously variable, both in the cost and the quality and the outcomes. And that's where the value is going to be. Once you start putting together, I don't care if it's restaurants or folks who park cars, you know, you're going to look at their claims, look at their data and say, oh, wow, a lot of our claims are musculoskeletal. And then we say, let's see how we can do better on that. And I think the challenge is going to be that relationship with the broker and all those employers, because I think you're also aware brokers — there's a tremendous secondary gain on brokers part. They get a lot of money from the folks who ultimately pay them, who is not the employer. Two thirds of their revenue comes from the BUCA payers and all that. And who's actually say, well, if you stick with Anthem, you're going to get this, or if you stick with United, you're going to get this. So getting the brokers kind of out of the equation and getting some independent, I would call broker to look at the total population that whatever that association has, where's their spend, where are the opportunities? I think there's going to be tremendous opportunity for savings here. Not just savings, because this is not about cheaper. It's better value, to your point, better outcomes, better quality, lower cost. It's very attainable. And I think an employer with 20 employees is unlikely to say, well, let's look at our claims data. And plus, with 20 employees, it's too variable, right? One premature twins can blow up the whole plan, but if you start putting a bunch of reports, getting over 1,000 members now together, you'll have meaningful data that you can really act on. I think it's a great opportunity.
Grace: Absolutely. And to that point, across the board, looking at things from a high level, there needs to be an educational component if a MEWA is supposed to be implemented in Connecticut. Education across the board, from the sponsoring association to their beneficiaries, education from the carriers, and as well as the brokers as well. I think we need to have all people, you know, in this equation at the table discussing what the cost impact is and the best way to communicate it to consumers. And that's going to be a key component of this proposal as well. Just making sure that we educate the consumers on what to expect and to just kind of crystallize it. You know, how do we communicate with folks who are administrating the plan? How do we ensure data transparency and looking at our costs at a high level and how we can opt in and just kind of the life cycle of enrolling in an Association Health Plan. So that's going to be a huge component, hopefully once this bill gets passed.
John: So this sounds really good, right? We're all sitting here going, well, what's the problem here? And I can't help but think, so what is the — we've mentioned a few things that are the potential risks, and it seems as though this bill addresses a lot of those issues. Who's opposing this? And I don't mean Republicans, Democrats, although I suspect there's always some polarization there. But who's the lobby against this? Who doesn't want it? Is it the health systems? Is it a political party for whatever reason? Who would possibly oppose this?
Grace: In the past few years, we did see a lot of opposition from national level health organizations. So like the lung cancer organization, a lot of the ones that have to do with specific bodily diseases, things like that. And we also saw a lot of opposition from folks from minority communities. And again, I think those concerns are absolutely valid. We have put a lot of tremendous effort into ensuring that those with pre-existing conditions are protected. And I think there's always going to be a perennial debate about the public option versus a private option. And I think that's also come up in discussions as well. In Governor Lamont’s budget address, he talked about the Connecticut Option, which is not fully fleshed out yet, but he suggested that it would be a preferred provider network with some of the costs subsidized. But once you bring the word subsidization into the discussion, there's automatically going to be a cost shift. So we don't have a ton of details on that yet. I know that there is a bill out this session that would authorize OPM to study the feasibility of Connecticut Option. But since we don't have the details yet, it's kind of up in the air. But I know for a fact that Association Health Plans are tried and true and we have all the details ready. So we're willing to have that discussion with folks who are more pro-public option and just try to come to a common ground because I think the end goal is the same, right? We want to provide high quality, affordable health care to our residents in Connecticut, but the approach is going to be different.
John: And it doesn't necessarily have to be an either or option, right? It can be an end. This is just another option, I think.
Lisa: Yeah, I agree, John. I think the thought that there is one silver bullet solution is not real. We need multiple solutions and multiple paths for innovation to see what works and not, you know, one size fits all is not going to work for all. But, you know, I think the Association Health Plans, you know, to Grace's point are another, just another option, right? You can still have a Connecticut Option. It doesn't have to be the only option, but an option for employers to pick from.
Grace: For sure. And to that point, Lisa, and I kind of want to end on this, you know, Association Health Plans are not a panacea. They're not a cure all. And I think the messaging that we really want to pursue this session is that Association Health Plans work in addition to, not instead of. And I think once we acknowledge that and kind of drive that messaging forward, hopefully we can have a successful outcome.
Kim: I love that, Grace. And I want to give you, you know, one more chance to kind of paint a picture of like, what does success look like five years from now? So Association Health Plans are not a panacea, but if this is a wild success, what does the experience look like for small employers five years down the road?
Grace: Yeah, absolutely. The experience for small employers would probably be to have a lot of enrolled lives in the Association Health Plans and really to be able to drive down the premiums and to negotiate plans that best fit their employees. And again, the flexibility and the freedom with these plans can be very, very successful in the long run. And so hopefully in an ideal world, we can attract more people to come to Connecticut and give small businesses the power to say, now we offer health insurance. Five years ago, we didn't. But under Association Health Plans, we were able to do that and we were able to retain a lot of great talent in our workforce.
Steve: Yeah, this has been a very thoughtful conversation. We've covered a lot. I've learned a lot. I know our listeners will as well. And just to follow up on Kim's question. So one of the other co-founders, you probably know Jeff Hogan, refers to Connecticut as the land of frozen molasses, which may be true in healthcare. But we like to ask our guests that come from various backgrounds and skill sets and knowledge to kind of look forward rather than look backward. And if you had to predict or forecast what, even just beyond AHPs, how healthcare is going to unfold in the state of Connecticut over the next, even just two to three years, with your hat on, your experience working with the governor and so forth, what are your thoughts?
Grace: Yeah, I mean, I wish I could say I have a crystal ball, but I don't. I think the healthcare market could look very, very different in five years, hopefully with more options. And I think we really need to focus on bringing more carriers to the market and to increase competitiveness. So right now, we only have two carriers left in the small group market. So we really have to think hard about the message that we're sending to the carriers in terms of the market that they can offer plans to. At the end of the day, insurers need people to sell plans to. And if people leave the market or they move out of state, then that is going to be kind of really desolate for the insurance market. And I think Hartford is known as the insurance capital of the world. And I really hope it stays that way.
John: Grace Brangwynne from CBIA, thank you so much for joining us today. We really enjoyed the conversation. We wish you well in getting this legislation through this short session. And we wish you all the best. Thank you for joining us.
Grace: Thank you so much.
John: To learn more about MTVA and how to join our community, visit our website, movingtovalue.org. If you enjoyed this conversation, please follow us and leave a review on Spotify or Apple Podcasts. Thanks again for listening and for being part of this important movement.
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